published Saturday, September 8th, 2012

Catoosa County officials lean against energy excise tax


Sales tax breakdown in Catoosa County

• 4 percent goes to the state.

• 1 percent is local option sales tax, or LOST, which funds general operations.

• 1 percent funds special purpose local option sales tax, or SPLOST, which pays for special projects.

• 1 percent is for education special purpose local option sales tax, or E-SPLOST.

Source: Catoosa County

RINGGOLD, GA. — Catoosa County faces a loss of money when the state phases out a sales tax on electricity used by manufacturers.

But at a special meeting Friday morning at the Catoosa County Administrative Building, county and city officials leaned strongly against imposing a new energy excise tax to make up for the loss.

They figured the revenue generated by a 2 percent tax wouldn't amount to much anyway, and imposing it could put Catoosa at a disadvantage when trying to attract new industry — especially when officials in neighboring Whitfield, Walker and Gordon counties already have indicated they won't impose the tax.

"I can assure you that I'm not for any kind of new excise tax," Catoosa County Commission Chairman Keith Greene said at the joint informational meeting with county commissioners and Ringgold and Fort Oglethorpe city council members.

"We need to get some industry in here, some high-paying manufacturing jobs," Greene said.

The meeting was informational only with no official action taken. Catoosa attorney "Skip" Patty gave background information on the energy sales tax and county Financial Officer Carl Henson prepared a spreadsheet handout, estimating how the county and cities would be affected by its phase-out.

Catoosa currently has a 7 percent sales tax, with 4 percent going to the state and 3 percent staying in the county. The state plans to phase out manufacturers' sales tax on electricity by 25 percent a year until it's completely gone by 2016.

But cities and counties can vote by Dec. 31 to phase in a 2 percent energy tax to help make up for the loss of the state tax.

Catoosa and its cities could lose a combined total of about $45,000 in annual revenue, according to Henson's handout, an estimate based only on the $2.3 million in taxable electricity sold to manufacturers by the North Georgia Electric Membership Cooperative.

Greene asked Henson to prepare a more-thorough estimate and include natural gas and electricity sold by other companies before Catoosa and its cities meet again in October for a formal vote on the energy excise tax.

Even without knowing the precise figure, officials didn't think the loss of revenue would outweigh the benefit of attracting potential new business.

"Even if you doubled that number, you're still not [talking] a whole lot of money," Henson said.

The state sales tax on electricity only applies to energy used in manufacturing, it is not being phased out on such things as heating and cooling a firm's offices.

about Tim Omarzu...

Tim Omarzu covers education for the Times Free Press. Omarzu is a longtime journalist who has worked as a reporter and editor at daily and weekly newspapers in Michigan, Nevada and California.

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